There is little doubt that developments in data science will have – indeed, are already having – a profound impact on asset managers’ operations and customer service. How can asset managers best use this emerging technology to engage new clients and consumer groups?
Data and technology will be one of the key themes at FundForum 2018, a global investment conference being held in Berlin next week. I am moderating a debate at the conference, alongside a distinguished panel of asset management CEOs, CIOs and digital strategy experts, on how asset managers and wealth managers can use data and technology to take advantage of the opportunities these developments offer.
The asset management industry has long been rich in data, but it is only as computational power has increased and software become easier to deploy that asset managers and asset servicing providers have been able to interrogate that data more effectively to find efficiencies, add value and, ultimately drive performance and customer satisfaction.
Legacy technology and systems have slowed the ability of financial services companies to get more value out of their data, something that the shift towards digitisation and standardisation is overcoming. Innovations in artificial intelligence, such as machine learning and robotic process automation, are accelerating the trend by enabling the cleansing of unstructured data.
Where could these technological developments lead? A clue may be found by looking at other industries, especially those that have traditionally had to be the most finely attuned to their customers’ needs and wants in order to survive: for example, the general retail sector. What successful retailers – both those with physical stores and online – have been good at is ensuring that they put their end-customer experience at the heart of their processes. Capturing and analysing data has been central to their customer-centric approach. It has not only improved efficiency – ensuring the right goods are on the shelves when customers want them by anticipating demand – but it has enabled retailers to stimulate and guide desires and behaviours in a way that is personalised to the individual customer.
While the general retail sector and the asset management industry have many differences, they share the same fundamental goals, for all of which enhanced data analysis plays a growing role:
- In providing customer satisfaction – ensuring the goods (or investment performance) meet or exceed expectations
- In risk management – quality controls, regulatory standards, identification of negative trends/correlations
- In finding efficiencies and managing costs – cutting waste, standardising processes, automation
- In developing new products – driving and supporting research, product development and testing
- In supply chain management – creating seamless, integrated processes
- In developing customer relationships – enhancing the customer experience and developing opportunities to grow the business
Expectations of the asset management industry continue to rise, not least due to everyone’s experience elsewhere. Regardless of whether they are an institutional investor, wealth management adviser or a retail customer, we can expect increasing demand for immediacy (anytime, anywhere, up-to-date), intimacy (personalised, even if supported by algorithms rather than human interaction), slick interfaces, guidance for making decisions, and analysis in stimulating formats. Some of this is about presentation, but at its heart, it involves a significant change in the industry’s ability to manage and analyse the huge amounts of data it already holds.
How will successful investment managers respond to the challenges and opportunities? I look forward to discussing this topic more at FundForum.
Media Contact:
Bruce Wraight
+44 (0)20 7163 4716
+44 (0)7834 289638 (mobile)
bruce.wraight@bnymellon.com
